Friday, September 11, 2009

BB&T and its takeover of Colonial Bank

According to reports, including the Birmingham News, indicates that the BB&T Alabama operation is going to be headquarted outed of Birmingham.  Also the new head of the Alabama division is also a black man, Donta Wilson, which is a change considering pretty much all the heads of Birmingham corporations or regional HQs are older white males.

It is all following the acquisition of Colonial Bank by BB&T last month after the Montgomery-based financial institution collapsed due to major home loan defaults in states like Florida and Nevada.  Ironically, the company had purchased a number of small banks in Florida, Texas, and Nevada during the early 2000s after the financial regulations laxation due to the Gramm-Leach-Bliley Act of 1999 allowing anybody to acquire another financial institution as long as they have the cash.  Well. the 2007 home foreclosure crisis did Colonial Bank in because large number of home loan defaults in 2 of their expansion markets (Florida and Nevada).  The writing was on the wall to founder and former CEO, Bobby Lowder, because he stepped down earlier year after a huge quarterly loss.  Then Colonial Bank failed on August 14, 2009, and was taken over by FDIC and acquired by BB&T.

Raleigh-based BB&T was barely in Alabama before the Colonial Bank acquistion mainly with locations in rural areas in the eastern and northern portions of the state like Anniston and Oxford.  However, upon the Colonial Bank acquisition, it has become the one of the largest financial operations in Alabama and among the nation's top 10 largest financial institution.  However, the upside to this is Birmingham has gained another financial regional HQ, which is located on the former Shades Valley High School site located in Birmingham city limits.  It's not as good as was pre-2003 where Birmingham was home to some 4 large financial giants and known a "heavyweight", but its still good.  Now if we can acquire the regional HQ for Wells Fargo since they acquired Wachovia who had acquire the more financial solvent institution SouthTrust after the cheap ass former CEO didn't want to name his replacement instead sold the bank to Swiss-cheesed up Wachovia.

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